Trust, Then Verify

This article NPR : Mattel Recalls More China-Made Toys highlights one of the problems with doing business with an unproven supply chain.

In this case, the OEM in China had specified the correct paint to their supplier – who was a friend of the owner – but the paint supplier had given them less expensive lead based paint. (Some friend, huh?)

As the story reports, the owner of the OEM company took the coward’s way out and hanged himself.

So – Mattel probably trusted that their OEM supplier in China would deliver what they specified (and would continue to do so after first article inspections). The OEM, in turn, trusted their paint supplier would deliver as specified. Now Mattel’s reputation is in recovery mode and China itself is internationally embarrassed. (Believe me, they do not like it when that happens. On second thought, maybe suicide wasn’t a bad strategy after all.)

The awful truth is that the world out there has people in it who either do not understand that a particular specification is important (which is pretty common here), or worse, are out to make more money (less common, but it happens).

Lean Thinking Question:
What would you learn from this if YOU were Mattel?

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